Tips To Keep Your Finances in Order Without Sacrificing What You Want

Cameron Huddleston
·9 min read
Ivanko_Brnjakovic / Getty Images/iStockphoto
Ivanko_Brnjakovic / Getty Images/iStockphoto

If you’re trying to live on a budget, you might not feel like you can have the things you want. But you don’t have to resign yourself to living a bare-bones existence if your budget is tight — it’s possible to live on a budget and get some of the stuff you want.

See: 35 Useless Expenses You Need To Slash From Your Budget Now

Last updated: April 20, 2021

young woman using a laptop and doing her bills at home.
young woman using a laptop and doing her bills at home.

Create a Budget That Prioritizes Needs

If your income is limited, make sure it covers your needs first. “Food, shelter, clothing and utilities are needs,” said Donna Freedman, author of “Your Playbook For Tough Times. “The rest is just a series of wants.”

Creating a budget can help. List the expenses you have to pay to survive. Add them up, and then subtract them from your income. If there’s not much left over, you might have to make some sacrifices. Don’t think of cutting out wants to cover needs as deprivation, though — think of it as a smart use of available funds, Freedman said.

Read: Tips To Keep Your Finances in Order Without Sacrificing What You Want

objects for travel isolated on a wooden background.
objects for travel isolated on a wooden background.

Build an Emergency Fund

If you’re living on a budget, you might not think you can afford to set aside money each month in an emergency fund. But would you be able to afford an unexpected cost without savings?

“The thing that keeps you out of debt is to find room in your budget to grow your savings,” McClary said. You won’t be able to build your savings quickly, but if you can stash away a little each month, you can fall back on your emergency fund rather than go into debt when something unexpected happens.

Find Out: 17 Biggest Budgeting Mistakes You’re Making

paying with cash avoiding debt
paying with cash avoiding debt

Tackle Your Debt in Smart Ways

When you’re struggling with debt, you don’t want to just keep paying the minimum balance on what you owe. However, you may not be able to afford much larger payments, so you should look at other smart ways to tackle your debt. A personal loan could consolidate that debt into one set regular monthly payment.

See: 12 COVID-Proof Money Tips From Financial Planners

single man tax break
single man tax break

Take Advantage of Tax Breaks

If you’re a low-wage worker, take advantage of tax breaks when you file your tax return — such as the earned income tax credit. To qualify for the 2020 tax year, your income must fall below certain limits: from $15,820 if you’re filing as single, head of household or widowed with no children, to $56,844 if you’re married filing jointly with three or more children.

If the credit you receive is more than the taxes you owe, the IRS will refund you the difference. That tax refund can be used to help pay off debt, build an emergency fund or cover additional expenses.

Helpful: 19 Ways To Tackle Your Budget and Manage Your Debt

homosexual couple stands together in the kitchen at the stove and tasting the meal.
homosexual couple stands together in the kitchen at the stove and tasting the meal.

Eat at Home

Food is an essential expense, but it’s one that you can control. The best way to do this is by cooking at home rather than eating out. Unfortunately, nearly 44% of Americans’ food dollars go toward meals that aren’t prepared at home.

Plenty of websites provide recipes for meals that are cheap, easy and delicious. And by eating at home more often, you will be able to afford the occasional outing with friends or family, so you don’t have to give it up completely.

A young woman, housewife, decided to go to the supermarket and buy groceries for his family.
A young woman, housewife, decided to go to the supermarket and buy groceries for his family.

Cut the Cost of Groceries

The key to saving money on groceries is planning your weekly menu and shopping list based on what’s discounted at the supermarket. Check your grocer’s website for its weekly ad, or pick one up as you head into the store. Also, browse your supermarket’s clearance rack for deeply discounted items and the “manager’s special” meat bin for items marked down 30% to 50% for being near the sell-by date.

discount code on phone
discount code on phone

Find the Deepest Discounts

Don’t limit your deal hunting to groceries. McClary said you should spend extra time pursuing the deepest discounts on all the goods and services that you use. You can scour sites such as Slickdeals for the best prices on items you need, RetailMeNot for coupons and Cardpool for discounted gift cards that you can use at supermarkets, gas stations or retail stores.

garage sale
garage sale

Sell What You Don’t Need

You likely have hidden sources of income lying around your house — things you don’t need that can be sold. “Electronics, bicycles, collectibles and even toys might fetch a fair amount,” Freedman said. “Someone paid me $1,200 for a little plastic baseball figurine.”

So, scour your home for items you can advertise on Craigslist and Facebook. You can also sell them on eBay or to a consignment store. And then, you can enjoy that money how you want or need.

shopping at thrift store
shopping at thrift store

Buy Used Rather Than New

You can outfit yourself, your kids and your home for less by buying gently used items at a thrift shop or consignment store. In fact, you can often find quality items that are deeply discounted, McClary said.

The key is to shop at resale stores where more affluent people live. McClary said he once found a brand-name sports coat for $10 at a thrift store in a nice neighborhood near Chicago.

Happy African American businessman taking car keys from a sales person.
Happy African American businessman taking car keys from a sales person.

Cut the Cost of Insurance

You might be able to free up room in your budget by lowering your monthly auto insurance premium. “Ask how much you would save by raising your deductibles or whether it’s appropriate to drop collision,” Freedman said.

Also, shop around to find the best deal on auto insurance — you might save money by switching insurers.

Cropped shot of a happy senior woman sitting alone in her living room and going through paperwork.
Cropped shot of a happy senior woman sitting alone in her living room and going through paperwork.

Consider a Personal Loan for Needs and Wants

Sometimes what you need doesn’t always come at the right time for your bank account. But whether you want to improve your home, fix your car or make a big purchase that will help your overall life, a personal loan might be the right move for you.

By using a personal loan, you can avoid putting charges on high-interest credit cards.

calling utility company
calling utility company

Keep Down the Cost of Utilities

Even if your utilities seem overly expensive, it doesn’t mean you have to resort to bundling up in blankets all winter just to stay warm or sweating it out in the summer.

Consider calling your utility providers to see if they offer reduced rates for people in financial trouble. Or, if you live in a state with a deregulated electric or gas market, shop around to see if you can get a lower rate from another provider.

grabbing book in library
grabbing book in library

Take Advantage of the Public Library

No need to give up books just because the cost of buying them can add up quickly. The public library offers plenty of freebies that can make life more enjoyable — and affordable. You can check out books for free or borrow DVDs and CDs for no-cost entertainment.

McClary said public libraries also typically offer free Wi-Fi, so you can get online to find more deals, compare prices or search for better-paying jobs.

hiking in Big Sur California
hiking in Big Sur California

Find Free Things To Do

“You certainly want to do things that can add joy to your life,” McClary said. But when you’re on a budget, you should find ways to have fun that won’t leave you in debt.

Fortunately, there are plenty of free things to do in every state, from museums to hiking trails to public concerts. Check your city government’s website or community paper’s website for a calendar of events.

Find Out: How To Rebound From a Bad Financial Year

doctor appointment
doctor appointment

Take Advantage of Workplace Benefits

If your employer offers any workplace benefits — such as subsidized health insurance, a flexible spending account or a retirement plan with matching contributions — you should take advantage of them.

You might have avoided signing up for benefits because you didn’t want to have money taken out of an already small paycheck. But employee benefits can save you hundreds of dollars over time. Even if you work part time, you might still qualify for benefits, so check to see what’s available from your employer.

working at a coffee shop
working at a coffee shop

Find a Second Job or Other Opportunities

Taking on a second job — especially if you’re already working part-time — can help you go from scraping by to living comfortably. Even if you’re already living comfortably, the extra funds can help you buy the things you want.

You might even be able to make money without a 9-to-5 job by taking surveys at sites such as InboxDollars and Opinion Outpost, testing websites or participating in online juries.

driving for Lyft
driving for Lyft

Get a Job With Tips

When the company that she was working for closed down, Catherine Treme, a behavioral finance blogger, said she was able to live comfortably on a small income by working as a Lyft driver.

“With the tips, it made things a lot easier,” Treme said. She had a lot more wiggle room in her budget thanks to the extra cash.

Be Aware: 31 Hidden Ways You’re Bleeding Money Every Month

having a roommate
having a roommate

Get a Roommate

Another way that Treme was able to live comfortably on a small income was by splitting housing costs with a roommate. If your current accommodations aren’t big enough for two, find someone who is looking for a roommate on sites such as Craigslist, RoomieMatch.com or even Facebook. This way, you can enjoy other expenses you might want like vacations or a new car.

moving out of apartment
moving out of apartment

Consider Moving

You might be able to reduce your biggest monthly expense by moving to a smaller or older space, McClary said. “You don’t need to live in the newest, most modern apartment or house,” he said. “There are more competitive deals for older structures.”

If you live in a place where the cost of living is high, consider moving to a city where your paycheck stretches further.

“Take a moment to consider where you can relocate to find the same kind of employment opportunities but in an environment that’s much more affordable,” McClary said.

Couple consulting with insurance agent.
Couple consulting with insurance agent.

Get Assistance

Don’t let pride get in the way of reaching out for help so you can go from barely getting by to a more stable existence, Freedman said. There are plenty of public and private entities that can help.

Start by calling 211, which is the community services clearinghouse run by the United Way. It can connect you with local agencies to find assistance, but remember to be specific about what you need. You also can get help dealing with debt and budgeting issues by visiting NFCC.org to find a free or low-cost credit counselor.

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Taylor Bell contributed to the reporting for this article.

This article originally appeared on GOBankingRates.com: Tips To Keep Your Finances in Order Without Sacrificing What You Want